Explain exchange rate risk, Financial Management

Assignment Help:

Explain Exchange Rate Risk

Exchange-rate risk denotes to the risk the swap bank faces from fluctuating exchange rates throughout the time it takes the bank to lay off a swap it undertakes on an opposing counterparty earlier to the exchange rates change.  In addition, the dealer confronts credit risk from one counterparty defaulting and its comprising to fulfill the defaulting party’s obligation to other counterparty.


Related Discussions:- Explain exchange rate risk

Capital budgeting, identify and explain the key stages in the capital inves...

identify and explain the key stages in the capital investment decision-making process and the role of investment appraisal in this processs..

Regular payback period, The director of capital budgeting for a firm has re...

The director of capital budgeting for a firm has recognized two mutually exclusive projects, A and B, with the following expected net cash flows:

Cost-volume-profit analysis, Cost-Volume-Profit Analysis The Cost-Volum...

Cost-Volume-Profit Analysis The Cost-Volume-Profit (CVP) analysis provides answers to vital questions such as: At what sales volume would the firm break-even? How sensitive is

Risk associated with foreign direct investment, Discuss the risk associated...

Discuss the risk associated with Foreign Direct Investment. How do these risks differ from those encountered in domestic investment.

Absolute performance standard, Absolute Performance Standard is a method of...

Absolute Performance Standard is a method of measuring an organization's development and how effective and efficient it is at operating its business. The absolute performance stand

Securitization, Securitization -Source of financing whereby an entity's ASS...

Securitization -Source of financing whereby an entity's ASSETS (characteristically mortgage loans, lease obligations or other kinds of RECEIVABLES) are placed in a special purpose

Profitability index (pi), Profitability Index (PI) : It is a ratio of t...

Profitability Index (PI) : It is a ratio of the present value of the total cash benefits to the present value of the net cash outlay.  The higher the PI, the higher the return.

What are the reasons for mergers and acquisitions, Reasons for mergers an...

Reasons for mergers and acquisitions The key reasons for mergers and acquisitions, is to maximise shareholder wealth otherwise it wouldn’t be worthwhile. R

Statement of total comprehensive income for the year, At 31 July 2010 this ...

At 31 July 2010 this instrument meets the definition of a derivative: Small or no initial investment. Its value is dependent on an underlying economic item; exchange ra

Role of the public expenditure management system, Question : (a) The ro...

Question : (a) The role of the Public Expenditure Management System (PEMS) is to allocate and use resources responsively, efficiently and effectively'. Briefly explain the abo

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd